The recent arrest of a top
Huawei executive in Canada has put a spotlight — again — on the
Chinese telecommunications giant.

Huawei (pronounced Wah Way) is little known inside the U.S.
except as a target of U.S. security agencies. Yet the Chinese
telecommunications firm recently passed Apple as the No. 2
seller of smartphones worldwide after Samsung and is in a race
with other telecom firms to build out the next generation
wireless network, known as 5G.

What is Huawei?

Huawei, based in Shenzhen, is a Chinese telecommunications
equipment and hardware firm, the largest supplier of networking
equipment used by communications firms. It has more than 150,000
employees and has stood out from other Chinese tech firms
because of its large presence outside of China.

In addition to selling laptops and TVs, it is the leading
smartphone maker in its home market and is increasingly selling
its high-end phones ($600-$800) in countries across Africa and
Asia. But it is nearly locked out of the U.S. market.

What are the U.S. government concerns?

Since 2012, the U.S. government has raised the alarm on
suspicions that Huawei's hardware may have a technical backdoor
that could be used by the Chinese government to gather
intelligence. This concern has only increased in the race
between the two countries to create the 5G network, which will
provide faster internet technology.

Huawei has denied that its products pose any security risk and
says it is a private company.

This week Canadian authorities, at the behest of the United
States, arrested the firm's chief financial officer over
allegations that the company has done business with Iran, in
violation of U.S. trade sanctions.

What
has the U.S. done to limit Huawei?

This year, the FBI and CIA were among federal security agencies
that warned U.S. consumers not to buy phones built by Huawei or
its affiliate Honor branded phones that were sold in Best Buy
and on Amazon's online site.

More recently, the U.S. has lobbied countries not to buy Huawei
products. New Zealand and Australia announced they were banning
their wireless carriers from using Huawei's equipment. BT, a
United Kingdom telecommunications group, said it would not buy
equipment from Huawei as it builds its 5G network. And AT&T
didn't go through with a deal with the Chinese smartphone giant
to sell its phones to U.S. consumers.

What might happen next?

It's unclear if Huawei can keep growing if it doesn't gain a
foothold in the U.S. consumer market. And, as China and the U.S.
race to build the 5G network, there will be more scrutiny of the
Chinese telecom firm. But one observer says the tensions between
the two countries are bigger than the 5G race.

"These huge Chinese tech companies are bulking up and they are
getting into everything," said Rebecca Fannin, founder and
editor of Silicon Dragon, a media and events group covering the
tech industry worldwide. "They are innovating fast, sometimes
faster than U.S. firms, and there are growing tensions over that
issue, which is going to be more pronounced as it goes forward."